Davender Kumar Sharma vs Mohinder Singh & Ors.
2012 Latest Caselaw 5068 Del

13.

*      IN THE HIGH COURT OF DELHI AT NEW DELHI

+                    Date of Decision: 28.08.2012

%                            FAO (OS) No.413 /2012


       DAVENDER KUMAR SHARMA             ..... Appellant
                    Through: Mr. H.C. Mittal, Advocate.

                    versus

       MOHINDER SINGH & ORS.                          .....   Respondents
                     Through:

       CORAM:
       HON'BLE MR. JUSTICE SANJAY KISHAN KAUL
       HON'BLE MR. JUSTICE VIPIN SANGHI

VIPIN SANGHI, J. (Oral)

C.M. No. 14864/2012 (for exemption)

Exemption allowed, subject to all just exceptions.

FAO (OS) No.413/2012

1. The appellant assails the order dated 16.07.2012 passed by

the learned Single Judge in I.A. No.404/2012 (under Order 39 Rule 1

and 2 CPC) preferred by the plaintiff, and I.A. No.8907/2012 (under

Order 39 Rule 3 and 4 CPC) preferred by defendant nos.1 to 10. The

learned Single Judge has dismissed the plaintiffs/appellants

application to seek interim injunction under Order 39 Rule 1 and 2

CPC by the impugned order and, consequently, the other interim

application stands allowed.

2. The appellant has filed the aforesaid suit to seek specific

performance of the agreement to sell executed between the parties.

The case of the appellant is that vide agreement to sell dated

14.03.2011, and memorandum of understanding (MOU) of the same

date, defendant nos.1 to 10, who are jointly the owners of property

No.MPL No.WZ-14-C, built on Ahata No.40 admeasuring 200 sq. yds.

out of khasra nos.217, 218, 219 and 220, Manohar Park, Delhi had

agreed to sell to the plaintiff rights in the said immovable property

for a total consideration of Rs.95 lacs.

3. The appellant states that the said respondents had agreed to

sell the ground floor of the property. It was further agreed that on

receiving possession of the ground floor of the property, the

appellant would demolish the same and construct a four storey

building on it. The ground and third floor of the building to be so

constructed, were to come to the share of the appellant, whereas

the first and second floors were to go to the share of respondent

nos.1 and 2. Respondent nos.3 to 10 were to get the amount of

Rs.95 lacs in lieu of their share in the property and, under the MOU,

it was provided that respondent nos.3 to 10 shall relinquish their

share and interest in the property in favour of respondent nos.1 and

2. The appellant admittedly paid an amount of Rs.66,16,666/- to

defendant nos.1 to 10.

4. The appellant preferred the aforesaid suit complaining of non

compliance of the said agreement and the MOU by the respondents.

It was alleged that the respondent nos.3 to 10 had not surrendered

their share in the property in favour of respondent nos.1 and 2, nor

the possession of the property had been delivered to the appellant.

5. The appellant preferred the aforesaid application under Order

39 Rule 1 and 2 CPC alongwith the suit to seek interim injunction

against the respondents to restrain them from dealing with the suit

property. The respondents also moved an application for vacation

of the ad-interim injunction, being I.A. No.8907/2012. Both these

applications were disposed of by the impugned order.

6. The learned Single Judge has dismissed the appellants

application for injunction pending the disposal of the suit by

accepting the respondents submission that the agreement to sell

and the MOU were incapable of being specifically enforced under

Section 14(1)(b) and (d) of the Specific Relief Act (the Act). The

learned Single Judge has drawn strength from the decision of the

Supreme Court in Vinod Seth v. Devinder Bajaj & Anr., (2010) 8

SCC 1. The learned Single Judge has held that since the

agreement/MOU could not be specifically enforced, no injunction

could be granted to prevent its breach in terms of Section 41(c) of

the Act.

7. The learned Single Judge examined the present case on the

parameters and considerations laid down by the Supreme Court in

the aforesaid case. It was observed that there was no agreement

between the parties as regards the specifications of the proposed

construction on the suit property; the agreement does not say as to

what would happen if the plan for construction of floors, agreed

between the parties, is not sanctioned by the MCD/DDA; the

agreement is silent as to what would happen if the parties do not

agree on the specifications of the proposed construction; the

agreement does not provide for any mechanism to carry out joint

supervision and quality control during construction; the agreement

does not say that the specifications of materials for construction

would be unilaterally decided by the appellant and/or the quality of

the construction will not be disputed by the respondents; there is no

provision in the agreement for the respondent to supervise the

construction; the agreement does not provide for the eventuality,

where the construction raised by the appellant is not found

acceptable by the respondents; the agreement does not prescribe

any time within which the proposed construction would be

completed; it does not provide as to what would happen if the

appellant does not complete the construction or does not even

commence it at all, after taking possession from the respondents.

8. In this background, the Court concluded that it is not possible

for the Court, or even the Court Commissioner, to supervise the

construction. Consequently, the learned Single Judge has concluded

that the agreement cannot be specifically enforced by virtue of

Section 14(1)(b) and (d) of the Act.

9. We find ourselves in agreement with the aforesaid reasoning

adopted by the learned Single Judge. We may also note that the

MOU is not an agreement which is enforceable, but only an

agreement to agree, whereunder respondent nos.3 to 10 had

agreed to, in future, agree to transfer their share in the property in

favour of respondent nos.1 and 2. An agreement to enter into an

agreement in future, cannot be enforced, much less specifically

enforced.

10. Learned counsel for the appellant argues that the

specifications could be as prescribed by the CPWD. That is not the

issue in hand. This submission itself demonstrates that the parties

had not agreed between themselves in respect of a very material

and pertinent aspect. In any event, it is not possible for the Court to

supervise, on a continuous basis, the construction on the property in

question, particularly when the specifications have not been clearly

set out. The Court cannot compel the respondent nos.3 to 10 to

transfer their share in the property in favour of respondent nos.1

and 2.

11. The next submission of learned counsel for the appellant is

that, atleast, the agreement in respect of the ground floor can be

enforced, and the respondents can be directed to transfer the

ground floor of the property to the appellant for a consideration of

Rs.95 lacs.

12. In our view, there is no merit in this submission either. The

agreement is not only in respect of the ground floor, but also in

respect of the other floors. Whereas the appellant was to get the

ground and third floor, respondent nos.1 and 2 were to get the first

and second floor, when constructed. The agreement and the MOU

form part of the same transaction. They cannot be bifurcated. It

cannot be stated that the third floor, which constitutes nearly half of

the property agreed to be acquired by the appellant, constitutes a

small fraction of the property. It cannot also be said that the

amount of Rs.95 lacs forms the only consideration for transfer of the

ground floor premises. The appellant also had the obligation to

construct the upper floors so that they would become available to

the respondents.

13. Consequently, the decision in Gurdial Kaur (D) by LRs v.

Piara Singh (D) by Lrs, AIR 2008 SC 2019 as relied upon by the

appellant, would have no application. Moreover, under the

transaction, the rights of the respondents inter se were also

required to be settled. The appellant cannot contend that only its

rights should be partially settled leaving the respondents,

particularly respondent nos.1 and 2 in the lurch.

14. For all the aforesaid reasons, we find no infirmity in the

impugned order and dismiss the present appeal.

15. We, however, make it clear that the observations made by us

shall not come in the way of the appellant/plaintiff in prosecuting

the suit, as the observations have been made only for the purpose

of dealing with the present appeal arising out of the impugned

order.

C.M. No. 14863/2012

In view of the aforesaid, no directions are called for in this

application. The same is accordingly disposed of.

VIPIN SANGHI, J

SANJAY KISHAN KAUL, J

AUGUST 28, 2012 sr